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by 6/7/2000 8:53 AM
Stocks quoted in this article:
After Monday's closing bell, it was announced that Starbucks (SBUX - 37-1/2) would be added to the S&P 500 Index (SPX - 1457.84). Yesterday's trading was the first opportunity for investors to react to the news. Although the shares finished well off their highs, SBUX was still up over five percent from Monday's close. It appears that a large bearish debit spread was initiated in Tuesday's trading. In a bearish debit spread, the trader buys puts at one strike and simultaneously sells puts at a more aggressive strike to defray the cost of the puts purchased. A total of 4,940 contracts traded on the July 35 put in a series of blocks around 10:00 a.m. that went off at and near the offer price of 2. At the same time, the July 30 put witnessed a 2,200-contract block cross the tape at the bid price of 7/16.<
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by 6/7/2000 8:50 AM
Stocks quoted in this article:
The Ameritrade (AMTD - 12-9/16) out-of-the-money July 10 put saw heavy volume again in Tuesday's trading. The option saw 6,030 contracts change hands yesterday, highlighted by a 6,000-contract block that crossed the tape at one-half. On Monday, the option also saw some block activity when two 5,000-contract blocks went off at one-half. These trades may have been initiated as put-write positions in which case the trader will be able to collect the entire premium if the shares remain above 10 until July expiration. The total premium collected from yesterday's block trade is $300,000 (.50 X 100 X 6,000).<
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by 6/6/2000 3:45 PM
Stocks quoted in this article:
At least by one measure, the labor market continued to be very tight in May. Earlier today, the firm of Challenger, Gray, and Christmas announced May job cuts. There were 27,036 U.S. workers laid off from their employers in May, down 27 percent from April. Although last Friday's employment data showed an increase in the unemployment rate from a 30-year low of 3.9 percent to 4.1 percent, these layoff data suggest that employers are doing their best not to cut workers and that the labor market is just as tight as ever. In fact, May 2000 layoffs were 51 percent below May 1999 cuts, making May the ninth consecutive month in which job cuts were lower than the same month a year before. May was also the first time in 17 months that layoffs were lower than 30,000.
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by 6/6/2000 3:31 PM
Stocks quoted in this article:
Earlier today, the Labor Department released revised non-farm productivity numbers for the first quarter. The numbers showed that although business productivity increased again in the first quarter, the rate of improvement slowed somewhat. Non-farm productivity rose 2.4 percent in the first quarter. That compares to a 6.9-percent rise in the fourth quarter. The first-quarter increase was the lowest in three quarters, which points to a slowing in the productivity growth that has fueled the non-inflationary expansion the U.S. economy has experienced of late. Labor costs rose 1.6 percent in the quarter, the highest figure in three quarters.
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by 6/6/2000 3:03 PM
Stocks quoted in this article:
Shares of discount retailer Target Corp. (TGT - 58-1/4) have plummeted nearly 10 percent Tuesday on extremely heavy volume. This decline came as a result of concerns regarding the company's sales figures, as early indications for the first week of June showed that the firm's slow sales patterns have continued into the sixth month of 2000. Additionally, the equity is suffering in sympathy with fellow retailer Circuit City Group (CC - 39-1/2), which is trading about 24 percent lower in late-afternoon activity. On the technical front, TGT has been range-bound for over a year, trading between the 56 and 76 levels since late January 1999. <
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